Greek banks need to raise A$21.8 billion: ECB
(4 November 2015 – Greece) The European Central Bank (ECB) says Greece's troubled banks need an additional €14.4 billion euros (A$21.8 billion) to resume normal trading.
The figure announced last week is the result of an ECB review of the country’s four main banks following an agreement on the troubled country's third bailout: €86 billion from other eurozone governments in August.
The banks – Alpha Bank, Eurobank, National Bank of Greece and Piraeus Bank – must advise on how they plans to raise the money to increase capital cushions against future losses.
Originally, the bailout provided for up to €25 billion, significantly higher than the revised amount.
The country is racing to bail out the banks before year end, when new European bank bailout rules take effect that would require seizing deposits over the €100,000 limit on deposit insurance.
Greek finance minister Euclid Tsakalotos said that bank recapitalisation and a viable solution to non-performing loans will both happen before the end of the year.
Tsakalotos told Parliament that the country's Financial Stabilisation Fund will obtain common bank shares, with voting rights.
"We would like to influence the banks' policies, so that they do not invest in high-risk instruments. We do not want to influence top management appointments or to whom they should provide loans," he said.
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